PARLIAMENTARY DEBATES

HOUSE OF COMMONS

OFFICIAL REPORT

Standing Committee C

CHARITIES (AMENDMENT) BILL

Second Sitting

Wednesday 12 July 1995

CONTENTS

CLAUSES 1 and 2 agreed to.

Bill to be reported, without amendment.

Committee rose at twenty minutes to Eleven o'clock.

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47 Standing Committee C Wednesday 12 July 1995

[MR. MICHAEL J. MARTIN in the Chair]

Charities (Amendment) Bill Clause 1
TREATMENT OF CHARITIES WITH SAME CHARITY TRUSTEES AS SINGLE CHARITY. 1993 C. 10

Amendment moved [5 July]: No. 12, in page 1, line 9, after 'charity.', insert— '() The Commissioners may only exercise the power in subsection (6) above if they are satisfied the charities concerned have broadly similar objectives.'.—[Mr. Luff.]

10.30 am

The Chairman: I remind the Committee that with this we are taking the following amendments:

No. 22, in page 1, line 9, after "charity", insert— "() Before making a direction under subsection (6), the Commissioners must consult the charity trustees of the charities concerned.".

No. 23, in page 1, line 9, after "charity", insert— "() No direction may be made under the subsection (6) without the consent of all the charity trustees.".

No. 24, in page 1, line 9, after "charity", insert— "() No direction may be made under subsection (6) unless the objectives of the charities concerned are either the same or very similar.".

Mr. Peter Luff (Worcester): As we have a new Minister here today, it may be for the convenience of the Committee if I briefly recapitulate what I was saying last week about amendment No. 12, which deals with the exercise of the powers given to the commissioners by the Bill in connection with charities with broadly similar objectives or otherwise. A number of hon. Members voiced concerns that had been expressed to them by members of religious organisations. I have had the opportunity to discuss with my constituent Mr. Mann the assurances given by my hon. Friend the Under-Secretary—the hon. Member for Dorset, North (Mr. Baker)—and by my hon. Friend the Member for Wycombe (Mr. Whitney) last week. I think that the charities are satisfied with those assurances, which concerned a situation in which a religious organisation shared trustees with two different charities, one connected with a place of worship and the other with an entirely different purpose—often poverty reduction on alleviation. The charities would be grateful for a reassurance that what the Under-Secretary and my hon. Friend the Member 48 for Wycombe said is still valid, as I know that they are considering sponsoring an amendment in another place—the starred amendment was on the amendment paper last week. Those who made rigorous representations about charities—one of which is religious—with shared trustees but different objectives, would like to be reassured that they have no need to worry on that point. Last week we were discussing amendment No. 12 and the way in which the charity commissioners would exercise their powers when charities had broadly similar objectives. I made the point that common trustees did not by definition guarantee common objectives and that the charities could have widely different purposes. I am concerned about giving a power to the Charity Commission to direct such charities to be treated as a single charity without being sure that they have some element in common. It is a question of the consent and active involvement of the trustees. I have had many situations drawn to my attention in which groups of charities with different objectives have had the same trustees and it would be inappropriate in the extreme for such charities to be lumped together unless they saw an advantage in that process. For example, there was a case of a small village with three quite separate charities dealing with a cottage hospital, a public park and education. The villagers are anxious to keep the trusts separate and want to be reassured that the charity commissioners will not force them to combine. That matter is important for many reasons and is as relevant to big charities as to the small ones to which I have referred. Big charities will often want to keep separate organisations with shared trustees but different objectives—for example, an organisation dealing with overseas issues and one dealing with domestic issues. There are organisational and promotional advantages in maintaining that separation. I am told that one of the largest charities in the United Kingdom has common trustees for separate organisations dealing with education, the arts, sport, ecology, general grant making and memorial funds for the maintenance of properties. It is anxious to keep the trusts separate and to register separate accounts with the Charity Commission and it says that the trusts should not be lumped together just because they have identical trustees. Will the commission use its powers arbitrarily or only with the consent of those trustees who see an advantage in lumping their charities together, even if they have different objectives? My concern is that the charity commissioners may feel under pressure—for reasons of administration, convenience or constraints on spending—to combine charities that do not want that. That simple point lies at the heart of the amendment.

The Minister of State, Home Office (Miss Ann Widdecombe): I am pleased to be able to join this important Committee, even at this late stage. My hon. Friend the Under-Secretary of State, who previously represented the Government on the Committee, has been called to duty on another Bill. 49 I can give my hon. Friend the Member for Worcester (Mr. Luff) the assurances for which he asked. My hon. Friend directed most of his remarks to the amendment on charities that have similar objectives. The Bill allows the commissioners to make a unifying direction where a charity is established for the special purposes of, or connected with, another charity. In practice, the first charity should have objects similar to, but less extensive than, those of the second. The objects of both will be compatible under section 96(5) of the Charities Act 1993. Amendment No. 22 would require the commissioners to consult trustees of charities before making a direction under the new section 96(6). In fact, the commissioners will generally act only on an application from the trustees. That does not rule out the possibility that someone other than the trustees might make such an application. If that happens, I am assured that the commissioners will feel bound to consult the trustees. Usually, only the trustees will apply for such a measure, but if anyone else does the trustees will be consulted. There is no possibility of the commissioners deciding unilaterally to ally two charities without the specific consent of all concerned trustees. The other amendments basically cover the same ground and I have already addressed the points raised. I hope that my hon. Friend will accept my assurances and withdraw the amendment. If he does not, I urge the Committee to resist it.

Mr. Luff: I seem to have precisely the assurances that I wanted from my hon. Friend the Minister. I beg to ask leave to withdraw the amendment.

Amendment, by leave, withdrawn.

The Chairman: Given that there was a lengthy debate on the amendments, I do not propose to allow a stand part debate.

Clause 1 order to stand part of the Bill.

50 Clause 2
SHORT TITLE AND EXTENT

Question proposed, That the clause stand part of the Bill.

Mr. Ray Whitney (Wycombe): The clause provides that the short title of the Bill shall be the Charities (Amendment) Act 1995 and that it will apply only to England and Wales. In the absence of a specific provision on commencement, it will take effect immediately on Royal Assent. There is no need to delay commencement as the Bill will help rather than restrict those to whom it applies. As this will be my last opportunity to do so, on behalf of the Committee I thank you, Mr. Martin, most warmly for the way in which you have conducted our affairs. We have had a useful debate and we owe a debt to my hon. Friend the Member for Worcester for giving us the chance to explore what was seemingly an innocuous and entirely beneficial Bill, but which had some areas of concern that my hon. Friend the Minister had allayed.

The Chairman: Before I put the Question, I thank the hon. Member for Wycombe for his kind words and all members of the Committee for their help during our proceedings. I congratulate the hon. Member for Wycombe on getting through a Bill that is important to the charitable institutions throughout England and Wales that do an excellent job looking after many people who have serious difficulties. I wish those institutions well.

Question put and agreed to.

Clause 2 ordered to stand part of the Bill.

Bill to be reported, without amendment.

Committee rose at twenty minutes to Eleven o'clock.

THE FOLLOWING MEMBERS ATTENDED THE COMMITTEE:

Martin, Mr Michael J. (Chairman)

Hayes, Mr.

Hutton, Mr.

Llyod, Sir Peter

Luff, Mr.

Whitney, Mr.

Widdecombe, Miss